News Corp and Foxtel tread lightly on media reform

The Australian Financial Review | Dominic White | 19 October 2015

News Corporation and its pay-television venture Foxtel have softened their approach to the federal government on media reform amid growing signals in Canberra that the Prime Minister Malcolm Turnbull is determined to abolish outdated media laws if he can get sufficient political support.

News Corp joined Kerry Stokes' Seven West Media in lobbying successfully against Mr Turnbull's media reform policy proposals earlier this year when he was communications minister. The policy would have allowed more mergers between newspapers, TV networks and radio stations, but protected Nine, Ten and Seven's domination of sports broadcasting.

One well-placed industry source said the issue of media reform had "come forward light years" since the ousting of former prime minister Tony Abbott. Mr Abbott blocked Mr Turnbull's proposals for fear of upsetting powerful moguls. "It was off the table, never to be spoken about again and now suddenly it's back on," the source said.

Support from News Corp and Foxtel for a package would risk leaving Seven West Media isolated among media companies in not backing the abolition of the "two out of three" and "reach" rules, which limit further consolidation between traditional media players. Seven says it wants to see a complete media reform package before forming a view.

There is growing pressure for the government to scrap the reach rule in particular, after Seven launched an app that will stream its content across the country via the web. Rivals say the app makes a mockery of the rule, which prohibits any broadcaster from using the TV signal to broadcast to more than 75 per cent of the population.

There is also a growing recognition among media executives that Mr Turnbull is more willing than Mr Abbott to scrap outdated media laws. The new Communications Minister Mitch Fifield has stressed that he is seeking "broad consensus" rather than "unanimity" between industry rivals on what a reform package should include.

ANTI-SIPHONING LIST

News Corp Australia and Foxtel's respective chief executives Julian Clarke and Richard Freudenstein have met separately in the past fortnight with Mr Fifield, who told Fairfax Media last month that he is willing to look at the list of sporting events guaranteed for free-to-air television, which News and Foxtel want reduced.

Any such reduction in the so-called "anti-siphoning list" would have the potential to win support for a broader reform package from News Corp and its chairman Rupert Murdoch, who blasted Mr Turnbull on Twitter in May over his original policy – which would have left the list unchanged.

While News Corp and Foxtel have softened their approach to the government since the change of leader, their respective positions remain unchanged.
A Foxtel spokesman said: "We've always said we were up for a conversation about reform so long as it's a holistic approach. We are not up for cherry picking or doing one or two things that give an advantage to the free-to-air broadcasters but we are absolutely up for a conversation about a package of measures that cover the main issues."

News Corp declined to comment.

News and Foxtel are vying to get a toehold in free-to-air television through the proposed acquisition of a 14.9 per cent stake in Ten Network Holdings.

Fairfax Media's corporate position is to support the the abolition of cross-media ownership laws.


View the article on the Australian Financial Review